US Department of Justice: more extensive use of compliance monitors

New German legislation on compliance defense and cooperation credit

Lisa Miller on the World Bank, Sanctions and ICO

Lisa Miller, Head of the World Bank Integrity Compliance Office, explains. Listen to the podcast.

Lisa Miller on the World Bank, Sanctions and the Integrity Compliance Office [Podcast] – The Compliance and Ethics Blog

Fourth Evaluation Report the Netherlands – implementation OECD Convention against foreign bribery published

Op November 5th, 2020 the fourth Evaluation Report the Netherlands on implementation of the OECD Convention against foreign bribery has been published.  The OECD Report highlights the increasing efforts to combat bribery of foreign public officials in international business transactions. However, there are concerns about the low number of criminal prosecutions and settlements in the Netherlands. A number of recommendations are provided for further improvement.

De op 4 september 2020 in werking getreden nieuwe Aanwijzing hoge transacties wordt verwelkomd. Een punt van zorg is de onduidelijkheid over de rol en werkwijze van de commissie die moet toetsen of voorgenomen hoge schikkingen voldoen aan de gestelde eisen zolang nog niet voorzien is in bij wet geregelde rechterlijke toetsing van voorgenomen hoge schikkingen. In het OESO rapport wordt erop aangedrongen vaart te maken met deze wettelijke regeling en daarbij:

  • duidelijkheid te bieden over te hanteren criteria voor het treffen van schikkingen in geval van verdenking van buitenlandse corruptie wanneer het een schikking betreft beneden de in de Aanwijzing hoge transacties opgenomen drempelwaarde van 200.000 euro;
  • te voorzien in passend (onafhankelijk) toezicht op voorgestelde schikkingen in gevallen van buitenlandse corruptie;
  • richtlijnen te publiceren ten aanzien van ‘self reporting’ en de van verdachten van buitenlandse corruptie verlangde medewerking aan het onderzoek;
  • duidelijkheid te verschaffen over de mogelijkheid van het treffen van schikkingen met natuurlijke personen;
  • te voorzien in beleid en training over door het openbaar ministerie in acht te nemen factoren bij het bepalen van sancties in relatie tot schikkingen, het opleggen van aanvullende maatregelen tot verbetering van compliance en de (mogelijkheid van) aanwijzing van een compliance monitor om toe te zien op de naleving hiervan.

Ook andere aspecten worden belicht in het OESO rapport, zoals de werking van het regime ter bescherming van klokkenluiders en de reikwijdte van legal privilege in Nederland. Het rapport wordt binnenkort aangeboden aan de Tweede Kamer en is te raadplegen via de OECD website.

Dutch minister wants judicial review of large ‘transactions’

The Dutch Minister of Justice and Security has announced plans to amend the Dutch Code of Criminal Procedure in response to questions raised by parliament about substantial or extraordinary “transactions”. Transactions are payments agreed between the public prosecutor and a suspect in lieu of criminal prosecution. The plans amend the existing rules on substantial transactions and introduce a process of judicial review. The Minister also stated that the Public Prosecution Service’s instructions on these types of transactions should be aligned with the current practice of transparency. He stated that he will involve the Public Prosecution Service and the Council for the Judiciary to draw up the rules in further detail. Click here to read more.

Source: DeBrauwBlackstoneWestbroek, 14 February 2019

FCPA/Anti-Corruption Developments: 2018 Year in Review

US government enforcement of the Foreign Corrupt Practices Act (FCPA) in 2018 remained robust, and the trend of increasing multi-jurisdictional cooperation and enforcement continued throughout the year. In the United States, the 33 combined individual and corporate FCPA enforcement actions concluded by the US Department of Justice (DOJ) and Securities and Exchange Commission (SEC) in 2018 were largely consistent with the average number of enforcement actions brought over the last seven years. The US $2.91 billion in monetary sanctions levied in corporate FCPA enforcement matters in 2018 reached a record high, although the chart-topping $1.78 billion penalty imposed as part of the Petrobras settlement accounts for more than half of this amount. Outside the United States, a number of countries continue to substantially enhance the legal and regulatory structure for international anti-corruption enforcement, including by passing legislation establishing corporate liability for certain types of bribery offenses and authorizing prosecutors to enter deferred prosecution agreements or other negotiated resolutions with companies accused of bribery. Click here to download the full report.

Source: Steptoe – 28 February 2019.

TI 2018 Progress Report ‘Exporting Corruption’

Transparency International’s 2018 Progress Report is an independent assessment of the enforcement of the Organisation for Economic Co-operation and Development (OECD) Anti-Bribery Convention, which requires parties to criminalise bribery of foreign public officials and introduce related measures.

This twelfth such report also assesses enforcement in China, Hong Kong Special Administrative Region of the People’s Republic of China, India and Singapore, which are not parties to the OECD Convention but are major exporters, accounting for 18 per cent of world exports. The report has been prepared by Transparency International, with contributions from our national chapters and experts in 41 OECD Convention countries, as well as in China, Hong Kong SAR, India and Singapore. Click here to download the report.

Source: Transparency International, 12 September 2018

The Compliance Process

Even as regulators and prosecutors proclaim the importance of effective compliance programs, failures persist. Organizations fail to ensure that they and their agents comply with legal and regulatory requirements, industry practices, and their own internal policies and norms. From the companies that provide our news, to the financial institutions that serve as our bankers, to the corporations that make our cars, compliance programs fail to prevent misconduct each and every day. The causes of these compliance failures are multifaceted and include general enforcement deficiencies, difficulties associated with overseeing compliance programs within complex organizations, and failures to establish a culture of compliance throughout the organizational structure. In short, creating an effective compliance program is an inherently difficult task.

And yet, it may be that organizations can improve compliance within their organizations by rethinking the way they approach the compliance challenge. This Article — drawing on insights from cognitive psychology, behavioral economics, and behavioral ethics — sets forth a new method of evaluating compliance failures that focuses on the compliance process, which has the distinct, albeit interrelated, stages of prevention, detection, investigation, and remediation.

The Article argues that utilizing a process frame will assist industry leaders, regulators, and policymakers in conducting more effective root-cause analyses of compliance failures, which will lead to the creation, implementation, and better evaluation of compliance programs. Delineating clear boundaries for the stages within the compliance process is difficult, but getting these distinctions right is essential when confronted with significant or complex compliance failures, particularly when an organization lacks a robust commitment to compliance. Additionally, the process frame can be utilized across regulatory areas and corporate forms, which serves to cement compliance as its own proper field worthy of further inquiry and study.

By focusing on “The Compliance Process,” organizations, policymakers, and scholars will improve the tools available for them to assist in the creation and implementation of effective compliance programs.

Source: SSRN, Veronica Root, Notre Dame Law School, 28 March 2018. To download the Article: click here.

First-Ever ‘French Deferred Prosecution Agreement’ authorized by French Court

Compliance Standards & Model Risk

When applying ISO management systems for compliance (ISO 19600), anti-bribery (ISO 37001) and/or similar ‘in control’ tooling with regard to integrity management and business conduct, so called ‘Model Risk’ comes into play. Oversimplification, inappropriate model choice, errors in a model or misuse of a model may lead to the wrong picture, providing comfort in false security only. For ‘The insights of a good model risk management framework’, see: Marie Gothardt and Martijd de Groot in Zanders Magazine 2018-2.